Most U.S. Airlines Sign Letters of Intent for Their Share of $25 Billion in Federal Aid

The largest U.S. air carriers have all signed letters of intent on federal loans to help them weather the novel coronavirus, with United Airlines warning employees that a surge in outbreaks was hitting bookings, threatening a travel rebound.

United was among five carriers – along with Alaska Airlines, Delta Air Lines, JetBlue Airways, and Southwest Airlines – that the U.S. Treasury Department said on Tuesday had signed letters of intent regarding the terms under which they could receive U.S. funds under coronavirus relief law known as the CARES Act.

“We look forward to working with the airlines to finalize agreements and provide the airlines the ability to access these loans if they so choose,” Treasury Secretary Steven Mnuchin said in a statement.

Last week, the department said it had agreed on the terms for government loans under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, with five other airlines including American Airlines.

Airlines, suffering the industry’s worst crisis as the coronavirus pandemic crushes demand, have until Sept. 30 to decide whether to take the loan and can furlough or eliminate jobs starting Oct. 1.

Travel has picked up in some areas over the past two months as economies open up and travel restrictions loosen, though a recent spike in COVID-19 cases in some U.S. states has triggered more restrictions and started to weigh on bookings again.

United told employees on Monday to prepare to receive notifications of potential furloughs under the Worker Adjustment and Retraining Notification Act, known as the WARN Act, as soon as this week, a source with knowledge of the matter told Reuters.

U.S. airlines have warned that tens of thousands of jobs could be at risk in the fall.

This article was written by Tracy Rucinski from Reuters and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to [email protected].